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Bursa rally likely to extend with support by foreign funds

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Low valuation of stocks and currencies in Southeast Asian markets expected to draw investors.

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Free Malaysia Today

KUALA LUMPUR:
Foreign funds are expected to continue to accumulate local equities today to help Bursa Malaysia extend a rally that began last Friday.

Thong Pak Leng, vice-president of research at online trading platform Rakuten Trade, said investors will be drawn by the low valuations of both stocks and currencies in the Southeast Asian region.

However, he also cautioned investors to expect a correction “anytime soon”.

On the bright side, though, the correction is likely to be only for a short period.

The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) opened at 1,538.72 points this morning, a peek above yesterday’s close of 1,538.61 points.

But a see-saw pattern in early trading saw it ease a little to settle at 1,538.19 points just five minutes into the trading day.

Decliners matched advancers 133 to 135 on the broader market. Another 247 counters traded unchanged, 1,783 were not traded and nine others were suspended.

The turnover stood at 200.72 million units worth RM58.08 million.

Thong said the FBM KLCI is likely to hover within the 1,535-1,545 range today and the construction and utilities stocks are more likely than others to garner investor interest.

Wall Street was closed for Washington’s birthday yesterday while Hong Kong’s Hang Seng fell 184 points, halting the Dragon Year rally in response to the Chinese authority’s decision to keep interest rates unchanged.

Malacca Securities said the market is closely monitoring the Federal Reserve Open Market Committee meeting, unemployment claims and the Purchasing Managers’ Index data to be released by the various US authorities on Thursday.

Nonetheless, the securities firm said the buying interest is likely to continue on the broader market as the domestic earnings season approaches.

Among the heavyweights, Sime Darby remained on the uptrend, gaining five sen to RM2.56 and YTL Power was two sen higher at RM3.82.

Maybank was flat at RM9.46, while Public Bank and CIMB were down by two sen each to RM4.41 and RM6.38 respectively.

As for the actives, Hong Seng added half-a-sen to 2.5 sen, while Minetech, Bina Puri, Velesto and Destini lost half-a-sen each to 16.5 sen, 7.5 sen, 26 sen and 4.5 sen respectively.

On the index board, the FBM Emas Index gained 3.37 points to 11,424.02, the FBMT 100 Index improved 3.30 points to 11,071.67 and the FBM Emas Shariah Index rose 16.40 points to 11,494.38.

The FBM 70 Index was 30.63 points better at 15,362.68 while the FBM ACE Index slid half a point to 4,864.80.

Sector-wise, the financial services index dipped 26.61 points to 17,225.05, the plantation index added 15.28 points to 7,314.02, while the energy index was 5.16 points higher at 901.22 and the industrial products and services index bagged 0.02 of-a-point to 175.63.

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